Is it Wise to Ignore Correlations Between Customer Experience and Creation of Wealth?

Many academic studies were published over the last two decades that examined the correlations between improvements in customer satisfaction/advocacy/experience and increase in sales, profits, market share or share value. Below are some examples

If there was a debate, by now it is over. Yet, customer experience management practitioners often fail to convince their bosses and clients to take decisive actions that can measurably improve the experience of their customers.

I think the primary reason for this frustrating situation is the cultural divide:

CXM practitioners are often focused too much on the complexities of methodologies for measuring, and statistics. Our clients and bosses are often too focused on quarterly financial results.

CXM practitioners often lack the business domain knowledge required for the translation of market research findings into specific recommendations that our bosses and clients can embed into their strategy and process.

When we do amass the knowledge and courage to make the recommendations, our bosses and clients want us to predict their outcomes. Since they do not appreciate differences between correlations and causations they are frustrated with our lack of confidence in our own recommendations.

These cultural differences drive many CXM professionals into endless selection of “better” methodologies for measuring customer experience and pursuit of poorly defined accuracies of vanity metrics. In other words they retreat into their comfort zone and relinquish their ambitions of contributing to improve their employer’s ability to win in the market place. I can confidently predict that such surrender will not enhance their value to their employer.

Here are a few tips for bridging this cultural divide:

1. Start to think more as an economist than a statistician. Focus more on problems and processes that impact customer experience, and less on data, metrics and technologies.

2. Stop debating which methodology is better (CSAT/NPS/CES, etc). Your customers do not care how you measure their experience. They only care if your product, service, brand or company delivers a better experience to them than your competition.

3. Stop asking your customers the “on the scale from A to Z…” questions and pretending that to be the Voice of Customer. These scores rarely tell you WHY your customers chose a competing offer. The research is about discovery of new knowledge, not about tabulating survey scores into neat piles.

4. Model your recommendations extensively before you present them to your boss or client. They know how to assess and manage uncertainties in their own fields (sales forecasting, etc.). You need to frame your predictions similarly so your boss or client can assess risk/reward ratios and start acting.

“Be the change you want to see in the world” and if you don’t like the change, you will like irrelevancy even less.